Maybe you’ve heard it referred to as the Pareto Principle or the 80/20 rule. Focusing on your top 20% of clients isn’t a new concept, but it’s one that’s often forgotten or ignored.

Prioritizing your top 20% of clients allows your small business to optimize revenue, build strong relationships, and operate efficiently. It’s a strategic approach that pays dividends in the long run.

So how do you identify and retain your top 20%?

You Can’t Be Everything to Everyone

If I’ve learned one thing over my years in business, it’s this: cut the difficult clients loose immediately.  You’ll get a sense of vampire clients early on—they don’t respect your time, tell you how to do your work, nitpick every detail, constantly change their minds, etc. Gracefully let them go. Refer them elsewhere. Businesses, in their zeal to grow, often onboard clients indiscriminately, thinking more clients equate to more revenue. But is that revenue profitable?

Identify Your Ideal Clients

There’s a holy grail of clientele–the top 20%. They aren’t necessarily the ones bringing in the highest sales volume, though that might be one of the criteria. These are clients with whom you have a rewarding experience. Those who not only value what you provide but might even be singing your praises to other businesses, referring you, and broadcasting your worth and work far and wide.

Pause for a moment. Reflect on your current list of clients. Who among them fits this description? If you’re thinking about sales volume alone, you’re on the wrong track. Think profitability, the ease of collaboration, and the value of their network.

By concentrating on the characteristics, challenges, and problems faced by this top 20%, you get a blueprint. A blueprint that, when fed into your marketing strategy, can help you attract more of such clients.

Refine Your Marketing Strategy

Starting to direct your marketing strategy towards this identified top 20% doesn’t mean excluding others. However, it does imply a refined focus. With a clearer audience in mind, your business can experience:

  • Increased profitability.
  • Attraction of more ideal clients.
  • A boost in brand clarity and promise.

A widespread mistake is that businesses spread themselves too thin, trying to resonate with everyone. The result? Their message gets watered down, failing to attract the right clients. In fact, a diffused marketing approach makes it challenging to create a consistent customer journey, retain clients, or even understand what draws your ideal clients in the first place.

Recognize the True Cost of a Mismatch

Working with the wrong client or one that isn’t priced correctly costs you more than you think. Sure, the revenue number looks impressive, but what about the unseen expenses? The stress, the extra hours, the potential compromises on quality?

Embrace the mantra of quality over quantity. Don’t be lured by mere numbers. Instead, understand the value behind those numbers. By identifying and nurturing that elite 20%, you not only bolster your profitability but also build long-term relationships that are rewarding both financially and experientially.